James Hardie Industries Plc. · NYSE:JHX
James Hardie Industries — Investor Presentation (September 2010)
36 slides from James Hardie Industries's investor presentation, Sep 20, 2010
Slide 1: Investor Presentation September/October 2010
Investor Presentation September/October 2010
Slide 2: Forward-looking statements
This company statement contains forward-looking statements. James Hardie may from time to time make forward-looking statements in its periodic reports filed with or furnished to the United States Securities and Exchange Commission on Forms 20-F and 6-K, in the annual reports to shareholders, in offe
Slide 3: Agenda
3 Business overview USA and Europe Fibre Cement Asia Pacific Fibre Cement Group Outlook Summary Appendix Agenda In this Management Presentation, James Hardie may present financial measures, sales volume terms, financial ratios, and Non-US GAAP financial measures included in the Definitions section o
Slide 4: Global strategy
4 Aggressively grow demand for our products in targeted market segments Grow our overall market position while defending our share in existing market segments Offer products with superior value to that of our competitors Introduce differentiated products to deliver a sustainable competitive advantag
Slide 5: James Hardie - a world leader in fibre cement
5 James Hardie - a world leader in fibre cement USA Fibre Cement Products Siding Soffit Fascia Trim Backerboard Asia Pacific Fibre Cement Products Residential siding Commercial exteriors Flooring Ceiling and internal walls
Slide 6: Fibre Cement - superior product performance
6 Fibre cement is more durable than wood and engineered wood, and looks and performs better than vinyl, and cheaper and quicker to build with than brick Vinyl Fire resistant Hail resistant Resists warping Resists buckling Colour lasts longer Dimensional stability Can be repainted ? ? ? ? ? ? ? ? ? ?
Slide 7: James Hardie: a growth focused company
7 Annual net sales US$1.1b Total assets US$1.6b Net debt US$171.9m Operations in North America, Asia Pacific and Europe 2,500 employees Market cap US$1.97b S&P/ASX 100 company NYSE listing Note: Net sales, total assets and net debt are at 30 June 2010. Total assets exclude asbestos compensation. Jam
Slide 8: James Hardie - Q1 FY11 - results overview
1st Quarter operating results reflect a challenging US operating environment, higher input costs (particularly pulp and freight in the US), a higher net average sales price, a strong positive contribution by the Asia Pacific businesses and lower corporate costs. 8 James Hardie - Q1 FY11 - results ov
Slide 9: Business portfolio
9 Business portfolio At and for the three months ended 30 June 2010 * EBIT - Excludes Research and Development EBIT and Asbestos-related items USA and Europe Fibre Cement Asia-Pacific Fibre Cement 72% 28% 77% 23% 73% 27% *
Slide 10: The USA business - largest fibre cement producer in North America
10 Flat Sheet Plants Capacity (mmsf) Plants operating at December 2009 Cleburne, Texas 500 Peru, Illinois 560 Plant City, Florida 300 Pulaski, Virginia 600 Reno, Nevada 300 Tacoma, Washington 200 Waxahachie, Texas 360 Plants suspended at December 2009 Blandon, Pennsylvania1 200 Fontana, California1
Slide 11: US siding market - Exterior products
US siding market - Exterior products Note: 1) Market and share figures reflect siding only; exclude fascia, soffits & trim; data reflects Repair & Remodel and New Construction markets, combined. 2) Siding volumes exclude waste factors, a change from previously reported numbers. Sources: NAHB Builder
Slide 12: USA and Europe Fibre Cement EBIT and EBIT Margin
USA and Europe Fibre Cement * Excludes impairment charges of US$45.6 million in Q4 FY08 12 EBIT and EBIT Margin* EBIT EBIT Margin
Slide 13: Average Net Sales Price
Average Net Sales Price US$ per MSF USA and Europe Fibre Cement US$657 13
Slide 14: Product Leadership Example - ColorPlus
14 ColorPlus(r) Collection (pre-painted siding and trim): Driving growth against vinyl in Northern USA Launched in Western and Southern USA FY07 Higher quality products with higher revenue stream Strategy designed to reduce 'on the wall' cost and close gap with vinyl siding Supply of pre-painted ext
Slide 15: Product Leadership Example - HardieZone System
15 15 7th Generation versus 2nd Generation generic fibre cement The HardieZone(tm) System represents a logical extension of Hardie technology Product Leadership Example - HardieZone(tm) System
Slide 16: A challenging US operating environment
16 US housing starts data indicating signs of a stalled recovery* *Total USA Housing Starts - US Census Bureau A challenging US operating environment
Slide 17: Response to US housing downturn
17 Focus on primary demand growth and cost management Business re-set to balance supply and demand production suspended at Blandon PA (October 2007), Summerville SC plants and Fontana CA (November 2008) corporate-wide review of activities, projects and cost-saving opportunities changes made to SG&A
Slide 18: Asia Pacific manufacturing facilities
18 Five manufacturing plants in Asia Pacific FY10 net sales US$296.5m FY10 EBIT US$58.7m Higher value differentiated products Lower delivered cost Shift to growth model Asia Pacific Fibre Cement Asia Pacific manufacturing facilities
Slide 19: Asia Pacific Fibre Cement
19 Asia Pacific Fibre Cement General purpose flooring Exterior cladding Philippines Australia New Zealand Australia Ceilings and partitions Interior walls
Slide 20: Group Outlook - United States
United States The recovery in the US remains weak and fragile Hopes for an accelerated recovery have dissipated after expiry of the US government tax incentive at the end of April 2010, together with low consumer confidence and continuing competition from foreclosed properties, combined to inhibit a
Slide 21: Group Outlook - Asia Pacific and strategy
Asia Pacific The residential housing markets in Australia, New Zealand and the Philippines are expected to maintain their underlying strength in fiscal year 2011 Softness in the renovation and commercial markets is expected to offset a significant portion of the stronger new housing growth Group Str
Slide 22: Summary
We have a strong, well-established, growth-focused and high return business We have a sustainable competitive advantage Our model for strong growth is based on: Large market opportunity Superior value proposition Proprietary and/or protected technology Ongoing commitment to Research and Development
Slide 23: Appendix
@sames Hardie Appendix
Slide 24: Legacy Issues Update
Legacy Issues Update Asbestos A contribution of A$72.8m (US$63.7m) was made to the AICF on 1 July 2010. James Hardie's contributions to AICF since its establishment in early 2007 total A$375.1m James Hardie is continuing to work with the NSW Government and the AICF to finalise the details of A$320m
Slide 25: 1st Quarter 2011 Results - Overview
1st Quarter 2011 Results - Overview 1st Quarter operating results reflect a challenging US operating environment, higher input costs (particularly pulp and freight in the US), a strong positive contribution by the Asia Pacific businesses and lower corporate costs The net operating result including a
Slide 26: Key Ratios
Key Ratios 1 Excludes asbestos adjustments, AICF SG&A expenses, AICF interest income, gain or impairment on AICF investments, tax benefits related to asbestos adjustments, ASIC expenses and tax adjustments 2 Excludes asbestos adjustments, AICF SG&A expenses and ASIC expenses 3 Includes restricted ca
Slide 27: USA and Europe Fibre Cement Primary Growth Performance
USA and Europe Fibre Cement Primary Growth Performance All market and market share figures are management estimates. 27
Slide 28: Guidance
28 Challenges remain, with the operating environment in the US, in particular, still weak and fragile Management anticipates FY11 full year earnings excluding asbestos, ASIC expenses and tax adjustments to be in the range of US$110m to US$125m Management cautions that conditions remain uncertain and
Slide 29: Endnotes
Endnotes This Management Presentation forms part of a package of information about the company's results. It should be read in conjunction with the other parts of this package, including Management's Analysis of Results, a Media Release and a Financial Report. Definitions Financial Measures - US GAA
Slide 30: Financial Ratios
Financial Ratios Gearing Ratio - Net debt (cash) divided by net debt (cash) plus shareholders' equity. Net interest expense cover - EBIT divided by net interest expense. Net interest paid cover - EBIT divided by cash paid during the period for interest, net of amounts capitalised. Net debt payback -
Slide 31: Non-US GAAP Financial Measures
Non-US GAAP Financial Measures EBIT and EBIT margin excluding asbestos and ASIC expenses - EBIT and EBIT margin excluding asbestos and ASIC expenses are not measures of financial performance under US GAAP and should not be considered to be more meaningful than EBIT and EBIT margin. James Hardie has
Slide 32: Non-US GAAP Financial Measures (continued)
Non-US GAAP Financial Measures (continued) Net operating profit excluding asbestos, ASIC expenses and tax adjustments - Net operating profit excluding asbestos, ASIC expenses and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be more meaningfu
Slide 33: Non-US GAAP Financial Measures (continued)
Non-US GAAP Financial Measures (continued) Diluted earnings per share excluding asbestos, ASIC expenses and tax adjustments - Diluted earnings per share excluding asbestos, ASIC expenses and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be mo
Slide 34: Non-US GAAP Financial Measures (continued)
Non-US GAAP Financial Measures (continued) Effective tax rate excluding asbestos and tax adjustments - Effective tax rate excluding asbestos and tax adjustments is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than effective tax rate. The com
Slide 35: Non-US GAAP Financial Measures (continued)
Non-US GAAP Financial Measures (continued) EBITDA - is not a measure of financial performance under US GAAP and should not be considered an alternative to, or more meaningful than, income from operations, net income or cash flows as defined by US GAAP or as a measure of profitability or liquidity. N
Slide 36: Non-US GAAP Financial Measures (continued)
Non-US GAAP Financial Measures (continued) General corporate costs excluding ASIC expenses and domicile change related costs - General corporate costs excluding ASIC expenses and domicile change related costs is not a measure of financial performance under US GAAP and should not be considered to be
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